Investing in Qualified Opportunity Funds - Public Comment

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National Minority Technology Council 1629 K Street, NW, Suite 300 Washington DC 20006 202-600-7828 Karl.Cureton@NMTCouncil.org www.nmtcouncil.org

National Minority Technology Council ID: IRS-2018-0029-0001 Investing in Qualified Opportunity Funds

Department of Treasury (IRS REG-115420-18) Public Comment on Proposed Rulemaking for Section 1400Z-2 of the Internal Revenue Code

Concerning the Regulatory Flexibility Act Taxpayers who invest in opportunity funds and qualified opportunity businesses will have a significant future economic impact on a substantial number of U.S. small entities. Unfortunately, Treasury has certified that these proposed regulations, if adopted, would not have a significant economic impact on a substantial number of small entities that are directly affected by the proposed regulations. Because of the certification inserted in the 1400Z-2 proposed regulation, the Small Business Administration (SBA) will not receive a Treasury regulatory flexibility analysis and the public will not have a chance to make a public comment on any findings. To justify this action, the Treasury Department and the IRS state that these funds will generally involve investments made by larger entities and investments are entirely voluntary. This response is in conflict with the White House’s analysis of the revitalization impact represented by the Opportunity Zone legislation and statements made on the February 14, 2018 Fact Sheet(https://www.whitehouse.gov/briefingsstatements/president-donald-j-trump-expanding-entrepreneurial-opportunity-underserved-communities/):

Opportunity Funds are Treasury-certified private investment vehicles that aggregate and deploy private capital into Opportunity Zones.

Opportunity Zones exist to fund new and small businesses, develop blighted properties, invest in key local infrastructure projects, finance facility construction or refurbishment, and a number of other activities intended to revitalize and enhance local economic ecosystems.

BACKGROUND The Regulatory Flexibility Act of 1980, as amended, is taken from Title 5 of the United States Code, sections 601–612. The Regulatory Flexibility Act was originally passed in 1980 (P.L. 96-354). The act was amended by the Small Business Regulatory Enforcement Fairness Act of 1996 (P.L. 104-121), the Dodd-Frank Wall Street Reform and Consumer Protection Act (P.L. 111-203), and the Small Business Jobs Act of 2010 (P.L. 111-240).

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